The opportunistic human pathogen Pseudomonas aeruginosa is naturally infected by a large class of temperate, transposable, Mu-like phages. Phage escape leads to imperfect CRISPR matches between host spacers and viral protospacers, which fails to degrade phage genomes. We examined the genotypic and phenotypic diversity of P. aeruginosa PA14 populations as they resolve CRISPR autoimmunity, mediated by an imperfect CRISPR match to the Mu-like phage DMS3 prophage, and show that the lysogen evolution is distinct from the uninfected PA14 strain in the same environment. After 12 days of evolution, we measured a decrease in spontaneous induction in both exponential and stationary phase growth. Co-existing variation in spontaneous induction rates in exponential phase corresponded to a difference in the mutational modes of CRISPR self-targeting resolution, mediated either by host mutation or phage transposition. Multiple mutational modes to resolve genetic conflict between host and phage resulted in coexistence in evolved populations of single lysogens that maintained immunity to other phages and polylysogens that have lost immunity completely. None of the evolved lysogens share mutations with the uninfected PA14 strain evolving in culture. This work provides more insight into the nature of viral evolution in single ancestor lysogen populations like the CF lung, and highlights a new dimension to the role of lysogenic phages on the evolution of their hosts.